Click the Take Action button and call your Senator TODAY to ask them to Vote NO on SB 567!
SB 567 could be voted upon as early as Wednesday, May 24!

SB 567 could be taken up for a vote on the Senate Floor as early as Wednesday, May 24.

Call your Senator today and ask them to vote NO on SB 567 (Durazo) – because it will hurt small housing providers.

SB 567 violates the legislative agreement reached on AB 1482, the Tenant Protection Act of 2019 (the “rent cap” law), by dramatically expanding its provisions to impose even greater restrictions.

C.A.R OPPOSES SB 567 (Durazo), which expands AB 1482’s “just-cause” eviction provisions, making it even more difficult for housing providers to terminate tenancies when necessary. SB 567’s expansion of these “just-cause” eviction provisions will harm small housing providers by changing the rules on which they have come to rely and which were just enacted three years ago in AB 1482.

Background

AB 1482 subjected most rental properties in the state to statewide rent caps and “just-cause” eviction provisions for terminating tenancies. AB 1482 was the result of extended negotiations between the Governor, the Legislature, and stakeholders to come up with a statewide measure that would restrict tenant rent increases and restrict a housing provider’s ability to terminate a tenancy, but that would not drive housing providers out of the business. While most housing providers oppose these restrictions, they have learned how to work with them when planning for the operation of their businesses.

SB 567 undoes the legislative agreement reached on AB 1482 by, among other things, making it more difficult for small housing providers to move elderly relatives, or their adult children and grandchildren or other family members, into a unit on their property. Also, the bill makes it more difficult for small housing providers to exit the rental housing business, even if they are suffering financial hardship and need to get out.

C.A.R. is OPPOSING AB 567 because:

Current law is already among the strongest in the nation. Current state law already provides some of the most stringent renter protections in the nation. Specifically, AB 1482 already establishes a statewide rent cap and provides “just-cause” eviction protections for renters.

Small housing providers have come to rely on this balanced approach. SB 567 upends the agreement reached by the Legislature on AB 1482 and changes the rules applied to small housing providers just three years after they were enacted, thereby pulling the rug out from underneath small housing providers.

It disproportionately harms small housing providers and especially small housing providers of color. Costs associated with the care of elderly parents and family members disproportionately burden individuals and families of color and those without generational wealth. To alleviate some of these cost pressures, small housing providers who own a small property will move in an elderly parent or family member to provide both housing and care. SB 567 makes it more difficult for these housing providers to move in and care for an elderly family member.

It dramatically changes the rules midstream. In 2020, millions of small rental properties became subject to the rent cap and “just-case” eviction provisions established by AB 1482. Then the pandemic hit just three months after the bill took effect, forcing small housing providers to comply with a complicated new law while also navigating eviction moratoriums and trying to keep food on the table for their families. SB 567 will subject these properties to more radical restrictions – just as small housing providers were starting to recover and stay afloat financially.

Please call your Senator today and ask them to vote NO on SB 567 (Durazo) – a bill that violates the legislative agreement reached on AB 1482, the Tenant Protection Act of 2019 (the “rent cap” law), by dramatically expanding its provisions to impose even greater restrictions on small housing providers.

 

UPDATE: HOUSING PROVIDERS WILL NOW RECEIVE 100% OF THE BACK RENT OWED.

 

Santa Clara County tenants and landlords, please note the following updates to the rent relief program:

• The Santa Clara County local rent relief program is live! The program is targeted towards  Extremely Low-Income tenant households (≤30% of AMI) and will also connect eligible tenants to other programs to keep them stably housed. Visit www.sccrenthelp.org for more information and to apply for rent relief.
• Some Santa Clara County Extremely Low-Income tenant households (≤30% of AMI) who applied on the State’s website between March 15th and May 1st, may have received an email from the program that they were “rejected” and must apply through the local program.
• Landlords should not wait to apply. The State has represented that they are committed to funding 100% of the rental arrears and are working on making sure landlords with previously submitted applications will receive 100% of the qualifying rent arrearage.

 

As of March 15, 2021, the state has begun to accept applications to distribute the first $2.6 billion of direct rental assistance. This was allocated to California from the December 2020 federal stimulus package. Tenants and housing providers will be eligible for up to a year of unpaid back rent (April 2020 through March 2021) and allow up to three months of future rent payments (April 2021 through June 2021), depending on the availability of funds. Both tenants and housing providers are eligible to apply if certain criteria are met. 

• • The program is voluntary for housing providers to participate and apply
• Tenants of housing providers who do not opt in to the program will be eligible to apply for a 25% payment of unpaid rent so they will be protected monthly from the eviction moratorium until it expires.

The bill prioritizes households with the highest need for rent relief, targeting households with less than 80% area median income (AMI) and utilizing rounds to prioritize those who need rent relief the most:

• Round 1: Below 50% AMI or unemployed for 90 days.
• Round 2: Income below 80% AMI and in a community disproportionately impacted by COVID-19.
• Round 3: Everyone below 80% AMI not addressed in round 1 or 2 above.

The state has created a housing provider checklist and a tenant checklist for the requirements to complete a rental assistance application.

The portal that you can use to apply for state rental assistance is now live.

The City of San Jose and the County of Santa Clara will receive additional funds to implement local rental assistance programs. These local programs will give first priority to extremely low-income tenants making 30% or less of the Area Median Income (AMI). Local aid has been made available and applications are accepted at the same link as above.

The most recent federal stimulus package has been signed into law (American Rescue Plan) and will allocate additional funds to these rental assistance programs, as well as a homeowner assistance fund (mortgage assistance, unpaid utilities, and more).

In order to preserve their rights to seek damages and pursue unlawful detainer lawsuits against non-paying tenants after the expiration of the eviction moratorium on June 30, 2021, and their rights to apply for missed rent assistance, landlords must follow these procedures:

• No later than February 28, 2021: Provide tenants who missed rent payments between April 1, 2020 through February 1, 2021 with an informational notice of the extension of the Act and the establishment of the rental assistance program. An example of this notice prepared by the California Department of Real Estate is available here. Landlords who do not timely provide this notice cannot serve tenants with a 15-Day Notice to Pay Rent or Quit (described below).

• Each time a tenant fails to pay the rent due for a rental period (typically the first of the month), serve the tenant with:

• (1) a “Notice from the State of California” – An example of this notice prepared by the California Department of Real Estate is available at this link.

• (2) a blank “Declaration of COVID-19-Related Financial Distress” – An example of this notice prepared by the California Department of Real Estate is available at this link.

• (3) a “15-Day Notice to Pay Rent or Quit” – An example of this notice prepared by the California Department of Real Estate is available at this link.

• If the landlord has information on file that the tenant is a “high-income tenant” who makes over 130% of the median income in that county, they may request additional information proving the hardship. An example of this notice to be used in this circumstance prepared by the California Department of Real Estate is available at this link.

The California Association of REALTORS recently hosted a webinar on SB 91, which can be viewed here (required C.A.R. login).

Congressional leaders struck a deal Sunday on a nearly $900 billion coronavirus relief bill that will bring a new round of support to millions of Americans before year’s end. The bill passed both houses of Congress yesterday, and the President signed it into law earlier this week.

The agreement contains many priorities championed by NAR, including rental assistance, a fresh round of funding and simplified forgiveness for SBA loans, and more direct payments to Americans.

“Through this bill, our members will continue to have access to unemployment and small business assistance.  But perhaps one of the biggest wins is rental assistance, which we have fought hard for since the last major COVID-19 bill was passed in April. It will bring instant relief to both mom-and-pop property owners and American families in danger of going over a financial cliff at the end of the year,” says Shannon McGahn, chief advocacy officer for NAR.

“While this bill hit more traditional political obstacles than the ones passed earlier this year, it was always a must-pass bill,” McGahn says.  “One in five of our members took out a PPP loan. We made sure that Congress knew these items were critical to America’s 1.4 million REALTORS® and the economy as a whole.”

Specifically, the agreement reportedly:

• Provides a new round of direct stimulus payments of $600 to most Americans including dependents
• Extends all unemployment assistance, including the Pandemic Unemployment Assistance (PUA), through April 19, 2021, with a $300 weekly boost in payments through  March 14.
  • Unemployment benefits are extended to the self-employed
• Provides an additional $284 billion for Paycheck Protection Program (PPP) loans and $20 billion for Economic Injury Disaster Loans (EIDL) grants
  • Allows certain eligible businesses to receive a second PPP loan
  • Creates a simplified forgiveness process for most PPP borrowers
  • Allows for deductibility of business expenses paid for with PPP funds
• Provides $25 billion to the states through Sept. 30, 2022, for rental assistance and allows landlords to apply for funds on behalf of tenants
  • Includes payments for rent in arrears as well as utilities and other expenses related to housing
  • Extends federal eviction ban through the end of January
• Provides $7 billion to states for broadband expansion, including $300 million for rural broadband
• Provides new money for schools and vaccine distribution

Read more on NAR’s website about how this will impact your real estate business.